Shown below is the sales forecast for Cooper Inc. for the first four months of the coming year. On average, 50% of credit sales are paid for in the month of the sale, 30% in the month following sale, and the remainder are paid two months after the month of the sale. Assuming there are no bad debts, the expected cash inflow in March is:

Question

Shown below is the sales forecast for Cooper Inc. for the first four months of the coming year.  On average, 50% of credit sales are paid for in the month of the sale, 30% in the month following sale, and the remainder are paid two months after the month of the sale. Assuming there are no bad debts, the expected cash inflow in March is:

Quizplus · Accepted Answer

To calculate the expected cash inflow for March, we need to find the credit sales for January and February, and then calculate the expected cash inflow for each month.

The credit sales for January and February are:
January: $100,000 
February: $160,000

We can now calculate the expected cash inflow for each month:

March: 
50% of January sales = $50,000 
30% of February sales = $48,000 
Total = $98,000

Therefore, the expected cash inflow for March is $119,000 (98,000 + 21,000 cash sales for March). The best choice is C.

Shown Below Is the Sales Forecast for Cooper Inc